South Africa drops charges against Pravin Gordhan

Rand gains over 1.5 percent against US dollar as prosecutor rules Pravin Gordhan had "no intention to act unlawfully".

31 Oct 2016 11:58 GMT

South Africa's state prosecutor has dropped fraud charges against the finance minister and others accused along with him.

Pravin Gordhan, the minister, has been a vocal opponent of corruption and excessive spending by President Jacob Zuma's government, which has been hit by a series of scandals and slowing economic growth.

Gordhan had "no intention to act unlawfully", Shaun Abrahams, the chief prosecutor, said in Pretoria on Monday.

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"I have decided to overrule the decision to prosecute.

"I have directed the summons to be withdrawn with immediate effect."

The South African rand gained as much as 1.6 percent against the US dollar, while bonds firmed as Abrahams read his decision.

Abrahams said he foresees difficulties in proving the charges against Gordhan, which have driven a wedge between rival camps in the ANC.

Gordhan had claimed the charges were politically motivated, and received support from several members of the ruling ANC, including the nation's deputy president Cyril Ramaphosa and numerous ministers, as well as scores of business leaders.

Worries that Gordhan could be prosecuted or even removed from his job had increased the risk that credit rating agencies would downgrade South Africa to "junk" status, undermining efforts to revive economic growth.

Earlier this month, the authority charged Gordhan with committing fraud a decade ago when he headed the South African Revenue Service, the country's tax authority, which allegedly established a "rogue unit" spying on taxpayers.